The Lodging Conference 2017 Adam Lair, MAI Managing Director and Senior Partner alair@hvs.com | +1 (415) 896-0868

U.S. Hotel Transaction Volume ($2.5M+) * 2% Transaction Volume in Billions Average Price per Key 24% 30% 1% Source: Real Capital Analytics (RCA) * Preliminary Data

U.S. Hotel Transaction Volume ($2.5 - $10M) * 2% Transaction Volume in Billions Average Price per Key 26% 8% 7% Source: Real Capital Analytics (RCA) * Preliminary Data

U.S. Hotel Transaction Volume ($10M+) * 4% Transaction Volume in Billions Average Price per Key 24% 35% 2% Source: Real Capital Analytics (RCA) * Preliminary Data

Trends in Transaction Price Per Room Year Hotels Sold % Change Average Price Per Room   2017 YTD Q3 418 8% $ 213,684 -4% 2016 YTD Q3 386 223,572 2016 541 -29% 219,633 -11% 2015 761 1% 246,080 18% 2014 757 54% 208,500 6% 2013 490 29% 196,789 5% 2012 379 -16% 188,050 -3% 2011 451 86% 193,170 2010 242 203% 178,723 28% 2009 80 -71% 140,172 -21% 2008 278 -63% 177,535 2% 2007 747 4% 173,698 -9% 2006 715 16% 191,863 20% 2005 614 159,758 Year Hotels Sold % Change Average Price Per Room   2017 YTD Q3 810 3% $ 54,841 2% 2016 YTD Q3 783 0% 53,697 2016 1,203 -6% 55,113 5% 2015 1,285 25% 52,491 6% 2014 1,025 8% 49,553 7% 2013 953 31% 46,228 4% 2012 727 34% 44,375 2011 544 65% 42,005 2010 330 29% 40,738 -2% 2009 256 -59% 41,580 -21% 2008 626 -34% 52,375 2007 945 -11% 51,283 1% 2006 1,063 12% 50,751 2005 947 50,713 Source: Real Capital Analytics (RCA) * Preliminary Data

Historical Hotel Buyer Makeup 33% Source: Real Capital Analytics (RCA)

Historical Cross-Border Capital Flows Source: Real Capital Analytics (RCA)

Historical REIT Capital Flows Source: Real Capital Analytics (RCA)

Historical Hotel Lender Makeup Source: Real Capital Analytics (RCA)

2017 Q3 Sales by Price per Room ($10M+) 33% 44% 26% 3% 40% 8% Source: Real Capital Analytics (RCA)

Top 20 Active Markets by Volume 2017 Q3 Source: Real Capital Analytics (RCA)

Cap Rates Extracted from Sales Increasing Source: HVS & RCA

Past the Peak, But Stable Values Through 2019 Significant Value Decline Less than -10% Moderate Value Decline Between -3% and -10% Stable Values Between -3% and +3% Moderate Value Increase Between +3% and +10% Significant Value Increase Greater than +10% Source: HVS Hotel Valuation Index

Top 10 RevPAR Markets Through 2019 6 Las Vegas Orlando 2 7 New Orleans Anaheim 3 8 San Diego Philadelphia 4 9 Norfolk/VA Beach Cleveland 5 10 Oahu Charleston Source: HVS

Bottom 10 RevPAR Markets Through 2019 30 35 Los Angeles San Antonio 31 36 Seattle Chicago 32 37 Miami Portland 33 38 Columbus Denver 34 39 New York Nashville Source: HVS/STR Hotel Valuation Index

Most & Least RevPAR Growth Through 2019 7% Source: HVS

Key Takeaways Slow transactions among higher priced assets should offset minimal growth otherwise, resulting in stable transaction volume for 2018 and beyond. Primary, gateway markets will continue to be attract investors, and cap rates should remain relatively stable for those well-positioned assets that do trade. Interest rate increases, uncertainty about the economic cycle, and more conservative underwriting should continue to push overall cap rates higher in 2018. Supply remains the primary concern in most markets. Markets that have been sheltered from supply throughout the cycle will attract the most investor interest in 2018 before peaking. Near-term growth will be modest and slowing for most markets. Growth will be driven by ADR increases as supply suppresses occupancy. Values should remain stable in 2018. Source: HVS

Managing Director & Senior Partner Adam R. Lair, MAI Managing Director & Senior Partner alair@hvs.com | +1 (504) 231-2651 @HVS_Consulting